DeFazio's bill targets LNG pipeline project

It would clarify the reasons a government can use exceptions to build on private land

Legislation aimed at protecting private property from the use of eminent domain in building a pipeline designed to export liquefied natural gas has been introduced in Congress.

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By Paul Fattig

MailTribune.com

By Paul Fattig

Posted Feb. 9, 2012 at 12:01 AM
Updated Feb 9, 2012 at 2:46 AM

By Paul Fattig

Posted Feb. 9, 2012 at 12:01 AM
Updated Feb 9, 2012 at 2:46 AM

» Social News

Legislation aimed at protecting private property from the use of eminent domain in building a pipeline designed to export liquefied natural gas has been introduced in Congress.

In introducing the bill on Tuesday, U.S. Rep. Peter DeFazio, D-Ore., noted the U.S. Constitution limits the use of eminent domain to actions necessary for "public use" but said that pipelines such as the one proposed from Malin to a proposed LNG terminal in Coos Bay fails that test. Instead, it would boost corporate profits while increasing domestic energy costs, he said.

"The Constitution is quite clear: The government can only authorize the use of eminent domain if the action serves the public," DeFazio said in a prepared statement.

"Landowners should not be forced to give up their property so private companies and foreign manufacturers can ship low-cost natural gas overseas and spike energy prices here at home," he added.

"My bill simply strengthens our constitutional property rights and gives property owners a level playing field in negotiating access to their land."

DeFazio stressed that the legislation does not stop LNG exports; it only ensures private property owners will not be forced to sell their land for the exports.

A U.S. Department of Energy study determined the exportation of LNG could raise the price of natural gas by almost 11 percent for American households and 27 percent for industrial users, DeFazio noted. The study further concluded that higher natural gas prices could raise the price of electricity by up to 9 percent, because increased prices would shift electricity generation to coal-burning power plants, he added.

Shady Cove retiree Bob Barker, a pipeline opponent whose property bordering the Rogue River would be crossed by the pipeline, applauded the legislative effort.

"As landowners, we're extremely pleased that Congressman DeFazio has taken this step," said Barker, who owns the property along with his wife, Gail Barker. "Having the threat of eminent domain hanging over your head has caused a huge amount of problems for the six or so years this has been going on."

The problem is that any property slated to be crossed by the proposed pipeline is now under the cloud of eminent domain, he said.

"This (legislation) would take out a lot of uncertainty and risk for the landowner," he said. "If this goes through and the landowner wanted to sell the property, the buyer would also know they are negotiating on a level playing field."

Barker agrees with DeFazio's argument that the right of eminent domain should not apply in the case of the proposed pipeline.

"The basic principle is that it can only be used where there is a clear public need," he said. "Exports don't rise to that level.

"Hopefully, they will come together on this back in Washington," he added. "Energy companies will lobby to defeat this. But this legislation is the right thing to do to protect landowners."

In addition to crossing a little more than 100 miles of private property, as well as state and county lands, the pipeline also would go through some 30 miles of national forestland and 40 miles of U.S. Bureau of Land Management land.

Easements would be needed on the private parcels, although the Federal Energy Regulatory Commission granted the pipeline builders the right of eminent domain as a last resort.

When the pipeline project originally was proposed in 2005, plans called for importing the pressurized natural gas to a main north-south pipeline in Malin, then on to customers in California. However, pipeline proponents announced late last year they wanted to export the natural gas.

The Williams company is studying DeFazio's bill, according to company spokeswoman Michele Swaner, who sent an email message late Wednesday afternoon to the Mail Tribune.

"The right to use eminent domain to acquire land rights to construct a pipeline and maintain facilities on a landowner's property is granted under the Natural Gas Act, which was enacted in the 1930s," she wrote.

"Eminent domain authority is given to interstate natural gas pipelines only when the Federal Energy Regulatory Commission has determined that a proposed project satisfies the public convenience and necessity requirement," she added. "Use of eminent domain occurs only after a pipeline has exhausted all other efforts to agree to a fair and equitable offer with a landowner for an easement."

The DOE has approved the firms' request to export natural gas from the proposed terminal in Coos Bay.

Portland-based Energy Action Northwest, a business and labor coalition promoting energy development, has come out in support of the project's preliminary approval by FERC to build the facility.

Company representatives have stressed the 3-foot-diameter pipeline buried underground would be safe to both the environment and landowners. But many landowners and environmental groups have disagreed adamantly.